Ernesto owns a house painting company. Total sales for the past year were $75,000. His bills for running the business were $30,000. Stan, who owns a furniture-making company, previously asked Ernesto to come work for him at a salary of $40,000. What is Ernesto's accounting and economic profit? Would Ernesto make more money working for Sam or working for himself? Explain your answer.
Correct Answer:
Verified
View Answer
Unlock this answer now
Get Access to more Verified Answers free of charge
Q113: _ occurs when long-run average total cost
Q114: The first part of a typical long-run
Q115: _ is a source of diseconomies of
Q116: _ is a reduction in costs that
Q117: Because of diseconomies of scale, a firm
Q119: Explain why zero economic profit is not
Q120: Maria's expenses for her painting business include
Q121: Explain why fixed costs exist only in
Q122: (Figure: Short-Run Cost Schedule)
Compute the missing
Q123: Explain why the marginal cost curve is
Unlock this Answer For Free Now!
View this answer and more for free by performing one of the following actions
Scan the QR code to install the App and get 2 free unlocks
Unlock quizzes for free by uploading documents